Government to Rise Import Duty on Solar Modules

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India’s government has now decided to rise Import Duty on Solar Modules. The government will impose 15-25% duty on solar gear imports from China. Importantly, this is to increase the nation’s independence of renewable energy sources and make it totally Atmanirbhar Bharat.

How much rise in Import Duty on solar modules?

As per the statement by Union Minister of Power and Renewable Energy Sh R K Singh, the government is now preparing to implement a 20-25% basic customs duty on imported solar modules from 1st August 2020. It will also be eventually extended to 40% a year.

Details regarding rise in Import Duty on solar modules

The Government of India has taken various vital decisions regarding the rise in Import Duty on solar modules. So, here are the key points of the decision:

  • Firstly, the Renewable Energy ministry decides to raise the import duty on solar modules that the customs duties will begin this August.
  • It will have a 15% levy and will rise to 30% afterward.
  • RK Singh (Power and Renewable Energy Minister) said in a Video Conferencing that India also needs to reduce imports in the Renewable Energy Sector from China.
  • Moreover, the Minister said that anything imported will be thoroughly inspected for malware.

Undoubtedly, the changes in customs duties on solar equipment would be a big blow to China, supplying 80-90% of the equipment used in the country’s rapidly growing solar energy sector. Besides, it is estimated that the power sector would become financially viable with new regulations and reforms to the law, making it market-friendly and limiting cross-subsidies.

Recently, the government has asked to not use any Chinese telecom equipment during its 4G upgradation.

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Analysis of Decision to Rise Import Duty on solar modules

Analysts said this decision might also hurt the Indian renewable energy sector in the short term, as it depends heavily on China. But, now its time to boycott China solar power modules.

Details RK Singh’s speech in the Parliament:

Year China Imports (in $ Million) Total Imports (in $ Million ) Percent of Chinese Imports
FY 17 2,817.34 3,196.50 88.10
FY 18 3,418.96 3,837.60 89
FY 19 1,694.04 2,159.70 78.40
FY 20 (April -December) 1,179.89 1,525.80 77

Impacts of the decision to Rise Import Duty on solar modules

Here are the positive impacts of the decision to Rise Import Duty on solar modules:

  • Local producers will now have to scale up development rapidly.
  • The project developers said they would need some policy support.
  • Importantly, the Renewable Energy and Power chairman Sumant Sinha said the projects that have already been awarded would not be affected by the adjustments in duty.
  • Additionally, it will allow companies to shift seamlessly to domestic manufactured components as the country ‘s capacity increases.

Moreover, Singh also dismissed any concerns regarding India’s ability to reach a renewable energy capacity of 175 GW by 2022. Citing a recent 2 GW SECI bid overwritten by almost 2.5 GW, the Minister of Power and Renewable Energy R K Singh has stated-

By 2022, we are going to hit our goals. There’s no doubt about that”.

Gradually, the Local producers having import-export code will also be able to export the power to other nations.


If you need any sort of guidance or assistance about the import-export code registration process, please feel free to contact our business advisors at 8881-069-069.


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